A/Z Testing: Crowdsourcing the ad creation process

You want to tell the world about your new service – an on-demand nail clipping service. Ads seem like a straightforward way to educate consumers. But what should it include? Should you place a picture of a nail clipper? Maybe untrimmed toenails? Actually, maybe a short clip is the key to lowering your customer acquisition costs The classic way to resolve this issue is to work with an ad agency. Surely they can leverage their expertise and generate the ad that will get that much-coveted users’ attention. But how good are they, really, at understanding MBA students’ nerdy jokes? Or art enthusiasts’ refined taste?

Maybe it’s time to let the crowds take a stab at it?

How might this look like? First, a company wishing to generate ads would post a brief on the ad generation crowdsourcing firm’s platform (which we will call A/Z Testing, borrowing from the term “A/B testing”): what’s the product/service? What are the key messages they think should be communicated? Who do they think is the target customer? Any specific guidelines that need to be followed? Second, A/Z Testing would communicate the brief to relevant ad generators (e.g., based on price point, interest, past performance etc.). Third, each ad generator would generate an ad, and test it with consumers. The metric that needs to be tracked, most likely, is customer acquisition costs per given size of population. For example, identifying which ad could capture ten thousand customers the cheapest. One ad generator might test a simple ad – just an image with a clear tagline. Another might think that the product is too innovative to be communicated in a still image, and thus creates a short clip. Both ad generators run Facebook campaigns, and track conversion – ideally of actual engagement (e.g., purchases or sign-ups), but at the very least cost-per-click. The video will cost more to push to consumers, but might get more, relevant clicks per expression. Importantly, each ad generator would need to specify the exact advertising mechanism (e.g., “target college students, in the Northeast, via Facebook”). Ultimately, the winners would emerge. Fourth, the company would pay the winners, and run a larger-scale campaign at (ideally) a low customer acquisition cost.

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The process outlined above is just one of many options. One can imagine many more. For example, the company could simply pay a fixed figure per purchase/sign-up to the users, and leave it to the ad generators to bring the traffic. This would be similar to the (already existing) affiliate marketing platforms, and would leave the company with less control.

There are, of course, challenges with this approach. A critical question to answer would be: when would this make sense? For example, with so many people working on marketing messages, will the required compensation be more than offset by the savings on acquisition costs? It is not uncommon to two ad concepts generating conversion rates different by a good multiple, so perhaps testing many ideas would lead to orders of magnitude? Another challenge is whether companies would be comfortable giving up control of their branding and marketing messages – if an ad generator uses messages not aligned with the company’s existing brand positioning, would the company still use the ad? In addition, there are technical challenges to overcome. One of them is tracking performance. Each company would need to track who referred the newly-acquired user (e.g., the short clip or the simple ad), and then automatically feed that back to A/Z Testing.

Assuming the above challenges are dealt with, the value created to the companies using the service is is two-fold –lowering acquisition costs is an obvious benefit, but perhaps more importantly, this would also let them better understand their customers. The value to ad generators is obviously the compensation, but also the ability to learn and to build a reputation, possibly allowing them to make the transition into the more traditional ad agencies should they choose to. A/Z Testing could capture value simply by charging a fee for using the service. Maintaining a barrier to competition wouldn’t be easy, with both companies’ and ad generators’ ability to multi-home on multiple platforms, should those emerge. There might be some advantage, however, to collecting data on ad generators, and better predicting which ad generator should be assigned to which project.

The idea of crowdsourcing marketing might make sense in a world where marketing expertise just isn’t as valuable as having a diverse set of ideas to test, with a low cost of experimentation. Time will tell whether such a model will emerge.